Unemployment rates are skyrocketing in Africa’s two largest economies, Nigeria and South Africa, and it is threatening to push both countries to the brink of a deeper socio-economic crisis.
South Africa’s headline unemployment rate hit a record high of 34.4 percent in the second quarter of 2021 from 32.6 percent in the first three months of the year as businesses shed staff due to the devastating economic impact of COVID-19.
The current rate is the highest since Statistics South Africa’s quarterly labour force survey began in 2008, and ranks the country highest on a global list of 82 countries monitored by Bloomberg.
Nigeria, which is third on the list after Namibia with 33.3 percent is yet to publish unemployment data this year but the expectation is that unemployment has spiralled in Africa’s largest oil producer as employers cull jobs to deal with COVID-19 as well as dwindling economic fortunes.
Nigeria will publish its job creation and labour force survey for the first and second quarters of 2021 on the 30th of August, according to the data release calendar of the National Bureau of Statistics.
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The unemployment crisis in both countries is a recipe for a deeper socio-economic crisis according to economists polled in a BusinessDay survey.
An acute scarcity of jobs and deepening poverty have fuelled social discontent which has found voice in protests in Nigeria and South Africa whereby protests against police brutality and President Jacob Zuma’s arrest turned opportunity for protesters to loot private stores.
The trend of rising unemployment and poverty does little favours for Nigeria and South Africa in their bid to boost consumer spending, attract investment and grow the economy.
It also puts pressure on Nigerian President Muhammadu Buhari and his South African counterpart, Cyril Ramaphosa, who have put job creation and poverty reduction at the heart of plans to revive their economies.
The South African economy has long suffered from high levels of joblessness, contributing to poverty and inequality that have persisted for nearly three decades after the end of white minority rule and were partly to blame for civil unrest in some parts of the country in July.
In Nigeria, unemployment has jumped since 2015 as the economy took a hit from two recessions in five years, creating a painful squeeze for businesses who have either shut down or downsized heavily.
